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Does Daily Commute Affect Auto Insurance Rates?


No person wants to stay in traffic longer than necessary, but are you aware that your daily commute could be affecting your insurance rates? The more kilometers you drive on a regular basis, the higher your chances of being involved in an auto accident.

Laws concerning insurance rates differ depending on the area, but one common feature is that the number of kilometers is always used to calculate your insurance premium. While some calculate based on daily mileage, others go for the total for the year. The good side of it is that you can get a discount if you happen to drive fewer kilometers than the annual average.

The following are some mileage guides used by insurance companies in determining your insurance rates based on how many kilometers you drive.


3 km or less: this is considered pleasure driving and would usually have no effect on your premium

4 – 9 km:  this should add a few dollars to your premium and is considered the first tier

10 – 15 km: regarded as the second tier, this range could cost you as much as $3-$5 every month

15 – 20 km: this is the third tier, and you could get as much as $8 extra

20 km or more: this is usually the maximum for many insurance companies and anything more than this might have you cough up an extra $10 monthly

Below are some tips to help reduce your insurance cost if you happen to use an insurance company that implements the annual mileage rating system:

  • Reduce the number of unneeded trips
  • Carpool whenever you can
  • If your employer has the telecommute option, use it
  • Use other forms of transportation available to you
  • Have your trips combined as much as you can
  • Shop close to your home

While some of these tips might be pretty easy, others can be a bit difficult. The bottom line, however, is reducing your mileage to cut down on your insurance costs, especially considering how much these simple steps can save you at the end of the year.

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